The long-awaited New Zealand Patents Bill 2008 (the “Patents Bill”) finally received Royal assent this month and has taken the last critical step toward repealing and replacing the New Zealand Patents Act 1953 (the “1953 Act”). The new Patents Act 2013, which has undergone several revisions and a significant debate on software patentability, will come into force on 13 September 2014 unless an earlier date is set by an Order in Council from the Governor General.
One of the main concerns with the existing 1953 Act is the standard of patent examination required in New Zealand which is less strict than that required by most other countries. One consequence of this is that patent rights granted in New Zealand may be broader in scope than rights granted for the same invention in other countries. Indeed, under the existing 1953 Act, it is possible for patents to be granted for inventions that are not new or that are merely obvious variations of what is already known. The grant of such overly broad patents can restrict access to products and services that should be free for all to use, thereby inhibiting rather than encouraging innovation.
Accordingly, the new Patents Bill was designed to reform and update New Zealand’s patent legislation to address these concerns and bring the legislation more into line with that of New Zealand’s major trading partners, including Australia.The following highlights some of the key changes that will be introduced by the patent reforms.
Novelty, Inventive Step and Utility
One of the key changes to be enacted by the Patents Act 2013 will be the replacement of local novelty requirements with a worldwide (“absolute”) novelty test. In this respect, an invention will now need to be novel in light of material made available anywhere in the world, whether by publication or by any other means (i.e. the Internet), as opposed to only being novel within New Zealand’s borders.
In addition, the ‘whole contents’ of unpublished New Zealand complete specifications having an earlier priority date will be taken into consideration when determining the novelty of claims in other applications.
Another key change to be enacted by the Patents Act 2013 is the inclusion of the ground of inventive step (i.e. obviousness) when examining patent applications. Therefore, once the new patent legislation has been enacted, the Commissioner of Patents will be allowed to refuse a patent application if the claimed invention is considered, by the Patent Examiner, to lack an inventive step.
The new Patents Act will also enable a third party to lodge observations as to novelty and/or inventive step between publication and grant of a patent. In short, the novelty and inventiveness of a claimed invention will therefore be measured against all matter made available to the public anywhere in the world.
The new patents legislation will also introduce a test for utility (i.e. usefulness). Therefore, once the new legislation has been enacted, the Commissioner will be allowed to refuse a patent application on the ground that the claimed invention is not useful (i.e. that the invention does not demonstrate a “specific, credible, and substantial utility”).
The Patents Act 2013 also seeks to define more precisely the scope of protection claimed for an invention. It will replace the existing ‘fair basis’ test with the more stringent requirement that the patent claims are ‘supported’ by matter disclosed in the complete specification and priority application. This change to the legislation may result in narrower patent rights than under the existing 1953 Act.
Balance of probabilities
A further key change to be introduced as a result of the new patents legislation is that the decision to grant a patent for an invention will now be made on the basis that the Commissioner is satisfied on the “balance of probabilities” that the claimed invention is patentable and that all the requirements of the legislation have been satisfied, rather than merely giving the Applicant the benefit of any doubt, as is currently the case under the existing 1953 Act.
Patentable Subject Matter
Of all the changes that are to be implemented as a result of the new patents legislation, the exclusion of computer-implemented inventions from patentability has received the most interest. Following much debate, and ultimately a delay in the final reading of the Patents Bill, it has finally been agreed that a computer-implemented invention will not be deemed a patentable invention in New Zealand if the sole inventive feature is that of a computer program. It will, however, be possible to obtain patent protection for a computer program if the inventive contribution lies outside of the computer (e.g. “embedded software” which is defined as computer software that plays an integral role in the electronics with which it is supplied) or if the contribution affects the computer itself but is not dependent on the type of data being processed or the particular application being used. By adopting this approach, it would appear that New Zealand is distancing itself from Australian and US patent laws and aligning itself more with the current European, and in particular UK, patent laws.
Lastly, the new patents legislation will continue to maintain the existing exclusions to patentability, namely, methods of diagnosis and therapeutic, surgical and diagnostic methods for treatment, and plant varieties. It should be noted that protection for plant varieties will still be possible via the Plant Variety Rights Act 1987.
The new legislation is expected to come into force in September 2014. The provisions of the Patents Act 2013 will apply to all patent applications filed after the commencement date of the new Act. Applications filed prior to that date will be handled under the existing 1953 Act.
Once the new legislation has been enacted, it is clear that patents in New Zealand will be more difficult to obtain. However, under the new legislation, patent owners will have greater certainty that their patents will be valid and enforceable.
In the meantime, while we await final confirmation of the commencement date for when the new legislation will commence, it may be in an Applicant’s interest to file a patent application(s) for an invention prior to the new reforms taking effect. This will secure the benefits of the lower patentability requirements and broader patentable subject matter requirements (in the case of computer-implemented or software related inventions) of the existing 1953 Act, as they currently stand.